Wireless/wireline integration: breaking the mode; What to do with multiple networks and a briefcase-full of devices?

Telecommunications Americas, March, 2004 by Sean Buckley

When Verizon Communications' CEO Ivan Seidenberg announced during the CES (Consumer Electronics Show) in January that the operator would spend $3 billion to upgrade its wireless network for nationwide wireless EVDO (Evolution for Data Only), packetize its voice network and advance FTTP (fiber to the premises), it was a sign that finally carriers are spending money. Perhaps even more compelling was that Seidenberg demonstrated a way to integrate services across each domain with its iobi service initiative and Verizon ONE device.

Verizon's initiative will enable customers to manage their own personal communications network--phone calls, voice mail and calendars--over the wireline and wireless phone, laptop or PDA. Instead of having to deal with multiple numbers and voice mail boxes, users would be able to link all their devices under one common number. A user could program calls coming to his office phone to his cellular phone mailbox.

"Our research tells us that an average user has about five phone numbers to manage, while techies and early adopters may have as many as 10," said Seidenberg in his CES address. "Much of what customers do in their communications environment can only be done in a single mode or on a single device. The consequence is that we have multiple layers of networks--voice, wireless, DSL, Wi-Fi, EVDO--and a briefcase-full of devices that, all too often, operate on only one platform or serve only one function."

According to Adventis Consulting, revenue loss to U.S. wireline carriers due to increased competition from wireless and cable operators could exceed $18 billion by 2010. This, combined with regulatory mandates allowing users to port numbers between their wireline and wireless phones, make a wireless/wireline integration strategy all the more compelling.

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Bundling Up

In the telecom world, there's a universal saying: The carrier with the billing relationship owns the customer. As a near-term integration strategy, integrated wireless/wireline carriers have all adopted bundling strategies. Offering the convenience of one bill, these carriers offer service packages that often include unlimited voice calling (both LD and local), data (DSL) and wireless on one bill. To top it off, RBOCs have also begun reselling satellite services as their initial foray into video entertainment.

As a step beyond service bundles, operators are moving toward wireless/wireline integration. Early movers on this concept include Verizon, Cingular (SBC/BellSouth), Bell Mobility and Sprint. Outside the United States, Primus has begun offering its PTS 888 handset, which provides access to its Global Call Saver, a service that gives users the advantage of least-cost routing on outbound international calls.

In addition to Verizon's iobi and ONE initiatives, SBC and BellSouth have been just as aggressive with Cingular's FastForward service, which provides the user with a cradle for the wireless phone that, in addition to serving as a phone charger, can forward calls from the wireless phone to a home wireline phone.

To BellSouth's CTO, Bill Smith, who himself has multiple mailboxes, pagers and addresses to manage, the attractiveness of wireless/wireline integration is one of user friendliness. "I am an avid supporter of wireless/wireline integration as an opportunity to add user simplicity," said Smith. "We've always in our industry talked about the killer app, and I don't know if there is such a thing, but if there is I am beginning to think that convenience and simplicity is that killer app."

While the demand for wireless/wireline integration is not totally overwhelming, the notion is gaining continued interest, according to In-Stat/MDR. In a survey of 221 employees from U.S.-based companies, an 11-percent minority said they are very interested in having a consolidated communications package, while 15 percent reported they were somewhat interested.

The Wi-Fi Connection

As part of this evolving integration, the next domain of integration will spill into the Wi-Fi arena, not only in hot spots, but also at the enterprise and home as extensions of the wireless and wireline infrastructure. Already there's a growing movement to enable users to roam between the cellular WAN and the Wi-Fi network as all the major cellular operators and wireline operators have begun dipping their toes into Wi-Fi--mostly for data connectivity via roaming partnerships with operators like STSN and Wayport to expand their respective footprints.

While the initial driver for Wi-Fi was data, voice will play an increasing role in places like the home or office; studies show a continued rise in cell phone use in these arenas. This is compounded by the fact that both enterprises and homes are adopting WLAN as an adjunct to their broadband networks. This idea continues to gain momentum with carriers that see it as a way to offload their already capacity-constrained WAN wireless networks, and provide a consistent level of service in the home or office.